Business Information Systems

Last Updated: 28 Jan 2021
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Characters (with spaces) and 1 figure: 22645 Question 1 Information Systems To understand and define an Information System (IS) thoroughly, it’s important to separate the two words and understand them separately. Information is produced by processing data so that it is meaningful which can be not only understood by the recipient but also used to meet a specific goal or requirement. To understand information, data needs to be understood as well. Data are raw facts like a specific date or measurement. Data needs to be processed and transformed into information; this process is called the ?? transformation process??. E. . data regarding sales of a firm is useless unless putting it in the correct context. But if you sort the sales after type of product, you will be able to see what product has been sold the most. By using data to gain relevant information, it’s possible to reduce the uncertainty of different questions and thereby improve the decision making. A system can be found in every part of the world. A system is a set of interrelated components that work together towards a common goal. The solar system might not a have an obvious goal while a firm might have several goals like gaining profit or making the best product possible.

To achieve these specific goals the system will need to obtain inputs and transform these into outputs, like described in the transformation process, data is seen as the input and information as the output. But to transform input into output isn’t enough. The output needs to be relevant compared to the objective(s) of the firm. For systems to be more effective the system can contain a feedback and control stage as well. By using the information we have just gathered it’s possible to define IS. IS is defined as the way people and organizations are gathering, storing and processing information.

In a business the IS will contribute to making the correct decisions. But IS isn’t solely used for managers and workers’ decision making it can also be used in other ways, like feedback for an organization’s quality. Computer-based information systems Today most IS involve Information Technology (IT) to create management information also called computer-based information systems. This is because of the many disadvantages it gives not having a computer-based information system. An IS can be divided into two categories called Operations Information Systems (OIS) and Management Information System (MIS).

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OIS contains 3 sub-systems each contributing in the daily running of a business. The 3 sub-systems of the OIS are: The Transaction Processing System (TPS), Office Automation Systems (OAS) and the Process Control Systems. The TPS is managing the many transactions occurring on daily basis on the operational level of an organization like withdrawal of money from an ATM, or orders and payments for goods and services. Even though the TPS is marked by a lot of repetitive tasks and routine, the function of it is essential and mission-critical to an organization. A TPS will e. g. secure that an ATM is running correctly.

If a person wants to withdraw money from his account via an ATM, the TPS will make sure that there’s enough money on the customer’s account so that the money can be withdrawn. The transaction will only take place if all tasks in the process can be completed. OAS is a common system within the OIS. OAS refers to the way that basic tasks in an office have been computerized. Before creating, storing and managing information was done physically, but by computerizing the office the time taking to create documents or arrange meetings is done faster, giving more time for the organization to take care of other tasks.

The OAS helps making the office more than just an area for typing but an area for exchanging important knowledge about the organization by still reducing costs as well. If a manager wants to set up a meeting instead of giving a paper to each participant, he can choose to send an e-mail to all the participants even though they aren’t at the same location. The process control system deals with large amounts of data created by production processes.

The process control system is used to control and support the different manufacturing processes of an organization. The process control system will automatically control the flow of the manufacturing process by a specific limit set by the user, and might e. g. support the production of a standard product like the Model T Ford car. The MIS contains three sub-systems. All three systems are supporting decision-making in a business and are called: Decision Support Systems (DSS), Information Reporting Systems (IRS) and the Executive Information Systems(EIS).

DSS uses raw data along with different business models to provide useful information for the manager which he can use for making tactical and strategic decisions, being especially semi-structured or unstructured. The DSS is often created by end-users, because they often have the much needed knowledge about the organization compared to a bespoke or on-the-shelf package developed by a third party. An example is the expert system which contains the knowledge and decision making skills of specialists, giving none-specialists enough knowledge to make decisions.

In the world of medicine, it’s possible for a nurse to enter the symptoms of a patient. The system will then compare the entered symptoms with all the different symptoms of different diseases already stored in a knowledge base and provide a diagnosis. A problem with the DSS is that the more options the system has the more complex it gets. IRS uses information to produce predefined reports for the day-to-day decision-making. There are two commonly known reports used by the IRS being the periodic and exception reports. The periodic reports is required by decision makers at regular intervals, it can e. . provide a report showing the sales of a product from day-to-day. The exception report is only being produced when needed; it might be produced automatically if a performance measure moves outside a predefined range. EIS is mostly used for the strategic decision making by senior managers to monitor, compare and analyze and thereby support the decision-making process of the senior manager. EIS could e. g. notify the senior manager with specific information about a facility anywhere in the world underperforming, giving him enough information to make a decision about the future of the facility.

The different IS just described are each used at different levels of an organization. The top leaders of an organization are all placed in the strategic level, where unstructured decisions are a big part of the management. They mainly use EIS to support their decisions but it’s important to notice that their decisions tend to rely on their own knowledge and experience as well. At the tactical level of an organization the expert and decision support systems are used to support the semi-structured decisions being made at this level.

The operational level of an organization makes a lot of structured decisions because of their little authority; therefore the TPS is used by the workers at this level on a day-to-day basis. The higher up we come in the organization the more unstructured the decisions are because of the level of authority rises. But this isn’t always true; it is possible to make unstructured decisions at the operational level as well as structured decisions at the strategic level. E. g. in a hospital the doctors (who work at the operational level) often have the authority to make important and less structured decisions.

Question 2 The project management process There are three key elements of the project management process being time, cost and quality. BIS (Business Information Systems) projects are likely to consume a lot of time and money and involve many parts of the specific organization; the project manager therefore has a big responsibility for the failure or success of a project and whether or not the project is following the time, cost and quality requirements given. The use of a well-structured project management process has the ability to highly reduce the chance of a BIS projects failure.

The project management process has four steps being: Estimation, schedule/plan, monitoring and control, documentation. The estimation step gives the project manager time to plan how much time and effort the project will take to fulfill the given requirements. The overall project requirements will be compared to the available resources. In the early stages of the project it’s often hard for the project manager to give precise estimations because of the great amount of uncertainty, but the project will often be constrained by a deadline or the type of people and hardware available.

Effort time and elapsed time is two important terms used to explain the amount of work different tasks will take. Effort time explains the total amount of work needed to complete a task while the elapsed time indicates how many calendar days the task will take. A project’s estimation will often change a lot from the start and to the end of a project because of the many constraints and changes that can occur. The requirements might change or hardware might break down, but a good estimation is essential to the success or failure of a project.

The schedule/planning step is about determining when a project should be executed; the finished schedule is then called the plan. There are two main terms important to notice called the serial and parallel relationship. The serial relationship describes how some activities have to be completed before another activity can start. The parallel relationship explains how some activities can be totally independent, but that four activities might need to run in parallel before an implementation can occur. Monitoring and control is a very important step which ensures that the tasks of a project are meeting the requirements.

This is done by monitoring the different tasks; if the project isn’t running as planned and is deviating from the given requirements, controls might need to be made for the project not to fail. To disseminate the information provided during project execution an essential step is documentation. It’s the project manager’s task to make sure that good documentation is provided from the different parts of the project. With poor documentation or without any information at all, the project might not deliver on time and the expenses of maintenance will most likely increase.

It’s also important that the documentation provided is acceptable and understandable. My project: To support my project planning a Gantt chart was made to show an overview of the activities. Project startup describes my first day of the project; I chose my questions and estimated the overall process of the project. I wanted to use three days on each question, all though I have to use four days on question 2 because of other homework. My writing will compared to my estimation be finished on the 30-okt and I will thereafter be editing the project. The product has to be finished and delivered on the 2-Nov.

If the project isn’t delivered on the 2-Nov the project will fail. The different tasks being question 1, 2 and 3 are in this project all independent but I chose to run them in a parallel relationship with the editing task so that before the editing task can occur, the three questions have to be answered. This gives me an overview of the size of my project and whether or not the project has to be shorter. I have been executing the project as planned so far regarding time (today 22-okt), but looking at the size of my project so far, I’m going need more time than estimated on cutting the project in the editing phase.

Relation between the project management steps and the SDLC The main phases of the System Development Life Cycle (SDLC) are by order: Initiation, feasibility study, requirement analysis, system design, build, implement, maintain and kill. The estimation step is used in almost all of the SDLC stages, and will be used more frequently in some stages depending on the type of project. In the initiation stage of the project the project manager will use estimation to make an overview of the project, estimating the different resources that are required to carry out the project, but the estimation isn’t detailed yet.

A detailed estimation will be produced when the project has been determined feasible and is under or close to production. The leader will estimate whether or not the project is feasible at the feasibility stage by using the information granted through interviews and reports. In the analysis stage the requirements for the new system will be specified. After the requirements have been established it’s possible to make a detailed estimation of especially the work required at the design and build phase.

The estimations will often be much more precise if timings from the previous projects are available. The scheduling and planning step runs alongside the estimation step. By knowing how much time and effort is needed for the project, it’s possible to make a more precise schedule of the process of the project. It’s important to always have a schedule of the plan for the project, but the most effective schedule will be made after the detailed estimation has been produced at the analysis phase (it can be produced at other steps depending on the project).

Once the schedule has been produced, the monitoring and control step will monitor the performance at all of the SDLC stages and ensure that the project is following the schedule/plan and fulfilling the requirements. It’s essential to monitor all of the SDLC stages since deviating from the plan can result in a project failure. Documentation is important during the whole project but especially essential at the development and maintenance phases. This is because most projects are based on team efforts.

Not only does the documentation allow monitoring and controlling, but it allows the different members of a development team to disseminate their design information between each other, making their work more effective. The V- and spiral model The V-model’s ?? V?? describes the graphical overview of the relationship between the different tests and SDLC phases, but the ?? V?? is also a synonym for verification and validation. The verification will check if there is any better solution to the design of the product, and that the design we are building is without errors or bugs.

The validation is used to test the design of the product and check whether the design is fulfilling the requirements. Validation and verification forms the basis for producing tests. The tests shown in the V-model are used during implementation which is why the model has the V-shape. But it’s important to notice that the life cycle phases on the left side have to occur, before the tests on the right side of the model can occur. A concern about the V-model is that it has no maintenance phase, meaning that it’s possible to believe that the product is finished and bug-free when signed off.

The SDLC can also be used via the spiral model. The spiral model is an iterative system. The three stages of analyzing, design and coding often tend to be repeated as a part of the prototyping process, and this is why the spiral model was made. The spiral model consists of four main activities: Planning, risk analysis, engineering and customer relation. The model contains all of the elements of the SDLC but it also contains risk assessment. By being able to make several iterations it’s possible to make a more detailed production and to add in new elements to the production because of the repetition. Question 3 The IS/IT function

The goal of using IS/IT is the hope that it will generate more benefit than the costs used on it. The function of IS in an organization, is to make the management process effective and support it. IT is the tools like hardware and software that the organization uses so IS can run and be built. Managing the IS/IT functions When managing IS there are different areas that need to be managed. It’s important to manage the development of the different business systems. When migrating from one system to another it’s important to have a project leader, as well as to manage and make sure that the migration is going as planned.

When inventing end-user applications, it’s important to have management to make sure that the software being produced isn’t full of bugs, and isn’t a reinvention. Other important areas that needs to be managed is the database administration, user support and training, shared services and the IS/IT staffing. It’s also important to manage different areas of IT. Some of the areas that need to be managed are which hardware platforms to use in the organization, the manager might choose to only use the client/server environment.

Good network architecture is also vital to an organizations sharing of information, and therefore it’s important that this area is managed. Many organizations use a lot of money on IT, and many big organizations have large amounts of IT including development tools. If this area isn’t managed, new tools being bought might not be compatible with the chosen database management systems or the selected hardware platforms. If an organization is using legacy systems, these needs to be managed so that it can still operate with newer systems (this might be an IS area as well).

A final important area to manage is the operations management which contains hardware management, capacity planning, security, technical support, telecommunications and network management. Organizing the IS/IT functions To organize the different functions of IS/IT isn’t easy, but an essential part of making IS/IT more effective in a business. It’s possible to ether centralize or decentralize when organizing the IS/IT function in a business. When centralizing, the IS/IT management will be placed in one specific spot in the organization from where all of the functions of IS/IT will be managed.

This could for example be the MIS, which will then be reporting to an IT director or another head of the department. Decentralization is the opposite of centralizing and means that the IS/IT functions will be spread out across the organization by having small IS/IT groups stored in different parts of the organization. It’s hard for organizations to be 100 % centralized or decentralized all though many organizations tend to focus on one of them. Outsourcing Outsourcing is a term used when a company chooses to subcontract a service to a third party. This service can be catering, cleaning, public relations and IS.

Outsourcing of IS management has become a major term in many companies in the world today because of its many benefits and uses. Some of these are cost reduction, quality improvement, risk reduction and to enable a focus on the core business. In a 2009 IBM survey of 2500 CIO’s worldwide 76% of the respondents anticipate to have a strongly centralized infrastructure in five years. A highly centralized IS/IT function does as mentioned before contribute to cost reduction, and having the function in one place makes it easier for companies to take advantage of developments like outsourcing.

By seeing more companies outsourcing and more companies wanting to centralize which both contribute to a lower cost might not be a coincidence, and can be a way of saying that IT is more than just a support capacity for the outsourcing/centralizing organizations. Outsourcing plays a huge role in the management process as well. The problem with outsourcing and its relationship with the management process is the importance of making outsourcing work. Outsourcing might be a huge trend, but this doesn’t necessarily mean that it’s going to work.

Many company’s outsourcing projects tend to fail because of bad management and contracts with the third-party. The failure of many outsourcing projects can have a connection between the management and organizing of the IS/IT functions. If the management and organizing of the IS/IT functions isn’t managed well or if the company isn’t seeing IS/IT as an important part of the company’s strategy, outsourcing has a bigger chance of failing.


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Business Information Systems. (2017, Jan 12). Retrieved from

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